Fergie's Tech Blog

SEC Accepts Morgan Stanley E-Mail Settlement

A Wall Street & Technology article, via Dark Reading, reports that:

The Securities and Exchange Commission filed a civil injunctive action against Morgan Stanley for failing to produce tens of thousands of e-mails during a Commission investigation lasting from December of 2000 through July 2005. The SEC alleges Morgan Stanley did not diligently search for e-mail back-up tapes and also that the company over-wrote multiple tapes. Morgan Stanley was charged with violating the provisions of the federal securities laws requiring the firm, a regulated broker-dealer, to produce its records and documents in a timely manner.

Morgan Stanley has agreed to settle the dispute without admitting or denying guilt. The settlement will have the firm pay a $15 million civil penalty, $5 million of which will be paid to NASD and the New York Stock Exchange, Inc. in separate related proceedings.

The SEC investigated Morgan Stanley's production failures after receiving an anonymous tip alleging that Morgan Stanley had destroyed and failed to produce e-mails in the Commission's probes. According to the anonymous tip, Morgan Stanley had not disclosed to the Commission the existence of relevant e-mails.

posted by Fergie @ 5/15/2006 04:05:00 PM